Problems can arise related to taxes when your identity is stolen. One is that someone using your Social Security number could file and receive a tax return before you do. When you file your tax return later than the identity thief, the IRS will send you a notice that more than one return was filed.
Another issue occurs when someone uses your Social Security number to get a job and that employer reports the income to the IRS. When you file your tax return, the earnings you claim will not include those from the illegal use. However, the IRS records will show that you failed to report income. The result is that the IRS will send a notice of the unreported income, not knowing that it was the result of identity theft.
An unexpected letter from the IRS may be the only alert indicating that your identity has been stolen and used for tax-related purposes. Also, know that the IRS will never make initial contact with a taxpayer through an email, text or social media message.
Scammers often claim quick tax refunds if personal and financial information, like your bank account, are provided. Resist the temptation. Do not reply, open attachments or click on any links within such an email. Instead, forward it to email@example.com and delete it.
The Better Business Bureau offers the following additional tips to avoid tax-related identity theft:
• Use a tax preparer who is a member of the National Association of Enrolled Agents. By clicking the link “Find an EA” at www.naea.org, you will find tax agents who abide by the organization’s code of ethics and have current tax education.
• A caller claiming to be from the IRS who demands money is likely a scammer.
• If you owe taxes and are late with your payment, an IRS agent will not involve police or an immigration agency.
• Keep your taxes safe online by updating your anti-virus software.
• Be sure to shred all tax-related paperwork when disposing of it.
If someone has stolen and used your Social Security number, find out more about creating an identity theft report at www.consumer.ftc.gov.
For more tips you can trust, visit the BBB at www.bbb.org or call (509) 455-4200.
Erin T. Dodge, BBB editor